Munich Economic Summit May 20th 2011

quo vadis social security ?

2

Need for action – Demographic trend

Ratio of population aged 20-64to population aged 65+

Persons of working age Persons of retirement age

1960

2010

2040

Source: Federal Statistical Office

The German pension system ‒ 3 pillars

1. Statutory pension insurance

2. Occupational pension schemes

3. Private pension plans

4

15

20

25

30

35

40

1990 2000 2010 2020 2030

Stabilisation in pension financing

Growth in the contribution rate for statutory pension insurance, in percent

Model calculation from 1987

German government’s current model

calculation22 %

36 %

5

35

37

39

41

43

45

2010 2015 2020 2025

44.6

43.1

41.0

38.1

Source: Federal Employment Agency, based on IAB calculations (Assumptions: constant labour force participation and zero net migration)

- 6.5 mln

Trend in the potential labour force

Potential labour force in millions of persons

6Source: Eurostat

73%

50%

55%

60%

65%

70%

75%

1991 1995 2000 2005 2010 2020

TargetEU 2020

Increasing percentage of working women

Employment rates among women aged 20-64, in percent, Germany

7

Part-time workers – International comparison

Normal weekly working time of female part-time workers, 2009, in hours

Sources: Federal Employment Agency, Eurostat

EU-15: 20.1

18.518.619.019.019.119.919.9.

20.0

20.220.9

20.9

21.5

23.3

23.725.0

15,0 17,0 19,0 21,0 23,0 25,0

Germany

IE

UK

PT

ES

NL

GR

FI

LU

DK

AT

IT

FR

BE

SE

8

Employment rates among older people

Share of gainfully employed persons among all 55-to-64 year olds, 2010, in percent

Source: Eurostat

EU-15: 48.4

36.6

37.3

39.639.742.342.443.649.250.053.756.257.157.657.7

70.5

15,0 25,0 35,0 45,0 55,0 65,0 75,0

IT

BE

LU

FR

GR

AT

ES

PT

IE

NL

FI

UK

DK

Germany

SE

9

Trend in the school drop-out rate

School drop-out rate, in percent

Source: Standing Conference of the Ministers of Education and Cultural Affairs of the Länder in the Federal Republic of Germany

9.0 9.19.4

9.7

9.2

8.88.6

8.1 8.07.7

7.5

7.0

5

6

7

8

9

10

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

skilled migrants